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Thu Jan 30, 2014, 10:27 AM

Can we talk about a Maximum Wage?

As long as we talk about minimum wage which will never affect the rich CEOs and captains of industry, they'll be able to keep saying how bad of an idea it is. It'll never even touch them in any way. So, what we need to discuss then, is a Maximum Wage.

The CEO of a company can make no more than a certain multiple of the lowest paid employee. Including benefits, stock options, bonuses, etc... the top brass can only make a certain multiple of the lowest wage they're willing to pay.

I suspect that we'll see a couple of things happen. Either the CEOs will start wanting to raise minimum wage to maximize their own salaries, or we'll see companies starting to make bumper profits when they aren't being dragged down by onerous bonuses and CEO salaries.

Just spitballing, here. Until there is something that affects those with the money, nothing will change.

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Reply Can we talk about a Maximum Wage? (Original post)
Saviolo Jan 2014 OP
geek tragedy Jan 2014 #1
Chan790 Jan 2014 #5
geek tragedy Jan 2014 #7
dionysus Jan 2014 #2
loudsue Jan 2014 #4
dionysus Jan 2014 #6
loudsue Jan 2014 #3
FrodosPet Jan 2014 #10
loudsue Jan 2014 #12
adirondacker Jan 2014 #59
Lurker Deluxe Jan 2014 #8
Demo_Chris Jan 2014 #14
Half-Century Man Jan 2014 #16
LineLineLineReply k
Lurker Deluxe Jan 2014 #18
Half-Century Man Jan 2014 #25
Lurker Deluxe Jan 2014 #27
Half-Century Man Jan 2014 #28
Lurker Deluxe Jan 2014 #30
Half-Century Man Jan 2014 #33
Lurker Deluxe Jan 2014 #31
Half-Century Man Jan 2014 #35
Lurker Deluxe Jan 2014 #43
Half-Century Man Jan 2014 #45
Lurker Deluxe Jan 2014 #47
Egalitarian Thug Jan 2014 #26
Lurker Deluxe Jan 2014 #29
Egalitarian Thug Jan 2014 #34
Lurker Deluxe Jan 2014 #48
Egalitarian Thug Jan 2014 #51
a kennedy Jan 2014 #9
hunter Jan 2014 #11
Lurker Deluxe Jan 2014 #13
hunter Jan 2014 #20
Lurker Deluxe Jan 2014 #23
hunter Jan 2014 #37
haele Jan 2014 #41
Lurker Deluxe Jan 2014 #46
hunter Jan 2014 #55
Lurker Deluxe Jan 2014 #56
hunter Jan 2014 #58
cali Jan 2014 #15
TBF Jan 2014 #17
world wide wally Jan 2014 #19
redqueen Jan 2014 #21
lumberjack_jeff Jan 2014 #22
Lurker Deluxe Jan 2014 #24
FreakinDJ Jan 2014 #32
ladjf Jan 2014 #39
Yavin4 Jan 2014 #36
JHB Jan 2014 #38
Donald Ian Rankin Jan 2014 #40
fadedrose Jan 2014 #42
Lunacee_2013 Jan 2014 #44
ProSense Jan 2014 #49
JHB Jan 2014 #50
upaloopa Jan 2014 #52
Egalitarian Thug Jan 2014 #53
moondust Jan 2014 #54
Travis_0004 Jan 2014 #57
Nye Bevan Jan 2014 #60

Response to Saviolo (Original post)

Thu Jan 30, 2014, 10:28 AM

1. the money for CEO's isn't in wage/salary, it's in 'incentive compensation' that

usually involves stock options/benefits.

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Response to geek tragedy (Reply #1)

Thu Jan 30, 2014, 10:33 AM

5. So you include that as part of their assessed compensation. n/t

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Response to Chan790 (Reply #5)

Thu Jan 30, 2014, 10:41 AM

7. I guess you could get the IRS applying Black Scholes to the option grants,

Not convinced that would work however.

Best to focus on livable wages at the bottom, plus tie corporate incentive compensation to much further down the road--7-10 years so they don't cook the books.

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Response to Saviolo (Original post)

Thu Jan 30, 2014, 10:29 AM

2. what if you work for yourself or say, in the entertainment industry?

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Response to dionysus (Reply #2)

Thu Jan 30, 2014, 10:30 AM

4. I say it should apply to any publicly held corporation OR privately

held essential service.

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Response to loudsue (Reply #4)

Thu Jan 30, 2014, 10:34 AM

6. sounds good to me



I generally don't have a problem with people making a lot of money, as long as it is attained by honest means. unfortunately, I don't know how often that is the case...

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Response to Saviolo (Original post)

Thu Jan 30, 2014, 10:29 AM

3. Holy shit YES!!! THIS is the conversation we really need to be having!!!

Not just in this country, but the world over!!!

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Response to loudsue (Reply #3)

Thu Jan 30, 2014, 10:51 AM

10. So what should it be?

3 times minimum wage? 5? 8? 15? 25?

Remember, if you set it too low, you will start to hit non-managerial skilled workers. And goodness knows how much fraud, delayed compensation, expense padding, and corruption there will be to bypass it. Just like drug prohibition - if people want something, they will ignore the law to get it.

So we spend government money to get the cops to go after them. Paper trail investigations, search warrants for financial records an emails. Might even need some phone surveillance and trips to the Cayman Islands to really find the dirt on all this new money laundering.

But cops tend to be authoritarian assholes, and we don't like them, and are not supposed to call them and should be working to get rid of them. So who is going to enforce the maximum wage laws? Making laws is relatively easy. Enforcing them is difficult.

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Response to FrodosPet (Reply #10)

Thu Jan 30, 2014, 10:55 AM

12. Yep. Enforcement is the problem, but the standards nevertheless have to be set.

Culturally, we need the new meme, and it is not the mess we have now.

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Response to FrodosPet (Reply #10)

Fri Jan 31, 2014, 09:37 AM

59. Ben and Jerry's set theirs at 10x the lowest paid worker which is the Green Party's proposed

system. If the lowest paid was $25,000, the CEO would be allowed to make a quarter of a million annually. I think it's quite generous. Also it would give incentive for the CEO to raise the lowest salary.

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Response to Saviolo (Original post)

Thu Jan 30, 2014, 10:48 AM

8. That will lead to more temporary jobs

If the multiple is tied to the lowest person on the payroll, there will simply be no more low tiered employees. They will use temporary labor to fill those positions.

Just think about it, if you're a CEO and the reason you can not get more money is because Becky, the receptionist, makes $11/hr. Simply, fire Becky and call up a staffing company and have a receptionists there the next day.

No more low wage people on the staff, period. All temps.

Horrible idea that will just lead to more temporary situational workers with no benefits and no job security at all. These CEOs who make these extreme salaries are not the problem anyways ... not like there are thousands of them running around, you're talking about a couple hundred people.

The problem is capital gains taxes, we need to tax all income the same after a certain level. Get rid of the deductions after a certain level, and create more tiers of taxation, at least two more tiers past the ones we have now.

I don't care how much money you make, as long as you pay your fair share in taxes.

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Response to Lurker Deluxe (Reply #8)

Thu Jan 30, 2014, 10:59 AM

14. Correct on all points. nt

 

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Response to Lurker Deluxe (Reply #8)

Thu Jan 30, 2014, 11:02 AM

16. Then attach it to a multiple of the median wage for whatever country.

And attach it to everybody who earns a wage.
The highest salaries in your country are no more than X times the median wage of your country.

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Response to Half-Century Man (Reply #16)

Thu Jan 30, 2014, 11:07 AM

18. k

OK.

So, I am a machinist. Been in the trades all my life. I make 85-100 depending on the year and how much OT I put in. I've been lucky pretty much all my life, always been healthy as a horse ... bought all three of my properties at the right time, and got some pretty good bank and a solid 401.

Let's say I use my great credit, borrow against my house, and drain all my saving to open a shop of my own, immediately going a cool mil in debt.

How much can I get paid a year??

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Response to Lurker Deluxe (Reply #18)

Thu Jan 30, 2014, 12:16 PM

25. If you incorporate your business

out of the profits of the business, you can pay yourself up to X times the median wage of your country. If you don't incorporate you can try to keep your company afloat earning no more than X times the the median wage of your country.

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Response to Half-Century Man (Reply #25)

Thu Jan 30, 2014, 12:18 PM

27. No more small business then?

You are either a corporation ... or to hell with you.

Nice plan.

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Response to Lurker Deluxe (Reply #27)

Thu Jan 30, 2014, 12:24 PM

28. What in the hell are you talking about?

Incorporating is how you start a business, a company. You separate the business portion of your life from the personal part of your life. If you have a company, you have incorporated.

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Response to Half-Century Man (Reply #28)

Thu Jan 30, 2014, 12:28 PM

30. we're talking about taxes

You do know that the majority of small business pay thier taxes as individuals, right? Even it is a SubS, they pay taxes as individuals.

So, what the hell are you talking about??

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Response to Lurker Deluxe (Reply #30)

Thu Jan 30, 2014, 12:35 PM

33. I was responding to your argument on companies cutting jobs to go around the idea in the OP.

Taxes were off my topic, sorry if that seemed vague.

I think that all income, no matter what source, should be taxed at the same rate (per the tax bracket the total sum lands in).

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Response to Half-Century Man (Reply #28)

Thu Jan 30, 2014, 12:29 PM

31. And ...

You do not incorporate to start a business, you get a DBA.

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Response to Lurker Deluxe (Reply #31)

Thu Jan 30, 2014, 12:39 PM

35. Do you mean using a "Doing Business As".

That is the way you name a registered incorporated business.

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Response to Half-Century Man (Reply #35)

Thu Jan 30, 2014, 02:15 PM

43. no

That is not true at all.

A DBA allows you to open a bank account, and other things, as the name of your company. It has nothing to do with being a corporation. I think you are mistaking a couple of terms.

I can open Lurker Deluxe Welding Repair tomorrow with just me as an employee. I can advertise under that name, and I can tell my customers that name, once they decide to pay me I can either have them write the check to me, Lurker Deluxe and cash it ... or I can have them write it to Lurker Deluxe Welding Repair, in which case I will have to get a DBA, Lurker Deluxe doing business as Lurker Deluxe Welding Repair, to cash that check.

It's still just me ... and I do not have to be incorporated, I can function as a sole prop as long as I like.

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Response to Lurker Deluxe (Reply #43)

Thu Jan 30, 2014, 02:26 PM

45. Ah yes that is completely true.

And it does leave your business legally connected to your personal finances. If your business is sued, for reason legitimate or falsified, everything you own is at risk.

One of the reasons most start up businesses fail. I learned that when I took a start up course via the Small Business Administration (say 7 years ago).

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Response to Half-Century Man (Reply #45)

Thu Jan 30, 2014, 02:29 PM

47. incorporation doesn't protect you

Because you are incorporated does not prevent you from facing liability from a lawsuit. If you are an owner and you are negligent in your business, incorporated or not, you will be held liable. Incorporating does protect some of your assets, but not many.

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Response to Lurker Deluxe (Reply #18)

Thu Jan 30, 2014, 12:17 PM

26. Nothing, because you've pretty well ensured that you will be broke very quickly.

 

In a sane nation with a rational economic policy, there would be a system in place to provide grants or low-interest loans, along with the personal assistance and knowledge to help the new SBO to avoid ending up like most do.

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Response to Egalitarian Thug (Reply #26)

Thu Jan 30, 2014, 12:26 PM

29. That's why risk is rewarded

Anyone going into business is risking alot.

So, if you are going to limit what I can make to some BS number attached to the median wage why would I take any risk? Why bother?

I've been self employed, twice, it wasn't for me. But The last time I did it I drained almost all of my savings and went into debt to the tune of 250K, I made some money for sure ... but it easily could have went the other way.

So, I just do not understand all this talk of limiting what a person can make. Tax them ... tax the hell out of them if they make over what ever number you seem fit, but to just flat out say, "you can only make this much" is a horrible idea.

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Response to Lurker Deluxe (Reply #29)

Thu Jan 30, 2014, 12:37 PM

34. As I said, in a sane system one would start a business because they want to do

 

whatever the business is and think they have a better idea. What you describe is the thrill of the gamble, and everybody should understand what happens most of the time when gambling. That is not an economic system, that is insanity.

As for limiting what a person can make, in one form or another, that is the only way to keep a community, city, state, or nation together and an economy going. The how is the purpose of the OP.

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Response to Egalitarian Thug (Reply #34)

Thu Jan 30, 2014, 02:35 PM

48. sane?

You start a business to make money, unless you are going non profit, why would there be any other reason to start a business?

Limiting what a person can make is just fundamentally wrong. Taxing what they make progressively is fine, putting a cap on it is crazy.

Just curious though, is the cap the same for everyone? Or can some people make more than others?

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Response to Lurker Deluxe (Reply #48)

Thu Jan 30, 2014, 03:05 PM

51. Personally I think two things would go the furthest. Eliminate any distinction between incomes.

 

Income is income, no matter the source or the form.

Then institute an inheritance tax that kicks in at a high level, such as we have now, but rapidly progresses to a confiscatory rate after $100M.

I don't know how any cap could be implemented or enforced, but the idea propelling it is a certainty, so I think it would be better to figure out how to deal with it now, rather than react to it after the fact.

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Response to Saviolo (Original post)

Thu Jan 30, 2014, 10:49 AM

9. Or a living wage....no one is talking about a living wage, was popular at one time.....now??

not so much.

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Response to Saviolo (Original post)

Thu Jan 30, 2014, 10:52 AM

11. I figure we need a generous minimum wage...

... a generous welfare system, a generous retirement system, and something like "minimum wealth."

Nobody would have less than that, and taxes would approach 100% at levels twenty times that.

In effect we would tax the uber-wealthy out of existence. There would be no incentive to hoard wealth or cash.

The guy who owned the corporation might live in a big house next door to the neurosurgeon, and the night janitor might live a few blocks away in a nice condo. Their kids would attend the same schools, and they'd shop in the same stores.

Nobody would be uber-wealthy, but nobody would be uber-poor either. The wealthy who wanted a higher standard of living would have a very strong incentive to make certain the work they were doing was improving living standards for everyone.

If the wealthy wanted their maximum wage to rise, they'd have to work to raise the minimum wage.

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Response to hunter (Reply #11)

Thu Jan 30, 2014, 10:58 AM

13. gibberish

I get it that there is huge inequality but at 20 times the minimum wealth taxed out of existence?

Who would actually do anything? Build anything? Do the terrible jobs that pay extraordinary because of the conditions? How would you raise capital to do anything?

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Response to Lurker Deluxe (Reply #13)

Thu Jan 30, 2014, 11:50 AM

20. A job that can't pay a good living wage isn't worth doing.

And capital would be raised the same way it is now, only it would be a much more democratic process.

Nearly everyone would have the means to participate in the market, if they wished.

As a practical matter I think people would tend to support smaller, family sorts of businesses, machine shops, restaurants, and the like, and governments would be more involved in the mega-projects. But no huge corporation would be controlled by small groups of insiders.

It's a small, negligible, subset of people who don't want to do anything. The larger problem is people can't find work or they are compelled to work for low pay in dangerous and/or abusive conditions.

Everyone ought to be able to quit a job that's dangerous or where the conditions are abusive without fearing hunger or homelessness.

Dangerous, abusive workplaces simply have to go away. This is the 21st century. We don't need that kind of crappy economic system anymore. We probably never did.





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Response to hunter (Reply #20)

Thu Jan 30, 2014, 12:10 PM

23. explain it to me then

If this, somehow, makes sense explain it to me.

Let's throw some numbers down. Minimum wealth is $100,000. So, if your wealth passes $2,000,000 then the government takes all of your income??

How's that work? You know what a machine shop worth 2M looks like?

Dangerous workplaces have to go away? Who's going offshore? Who's servicing tugboats? Who's fixing the radio towers? Those jobs pay way more than the average because they are dangerous and only certain people can perform those tasks.

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Response to Lurker Deluxe (Reply #23)

Thu Jan 30, 2014, 12:49 PM

37. Who is cutting apart your grocery store chickens?

People will do the "dangerous" kind of work you are talking about for good pay and the thrill of it. Heck, some people will PAY to do things like bungee jumping or rock climbing. (I have.) My sister is a firefighter-paramedic. That's not the kind of work I'm talking about. I'm talking about the dangerous, low paying, crippling kind of jobs; jobs with heavy exposure to toxic chemicals, crappy coal mines, lumber firms, fly-by-night roofing contractors, factory farm butcher shops, etc., etc..

And yep, that's how the numbers roll. Your machine shop grows, you take on partners -- long time employees, family, other people in the community, maybe even the community itself.

2 million dollar shops, yes, and I've also seen 20 million dollar machine shops that were mostly owned by lenders and liquidated with heavy losses during times of recession (recessions caused by big financial institutions in my economic models), leaving the "owners" and workers shit out of luck.

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Response to Lurker Deluxe (Reply #23)

Thu Jan 30, 2014, 02:10 PM

41. If you have a machine shop you are putting money into, the money for the business is a deduction

Look, the only feasible maximum wage "plan" in this country is to return the tax levels to pre-1980 levels and tweak from there as to what is and is not to be considered taxable income in a progressive manner. Even with tweaking, it's not going to hurt most small businesses and employers; it didn't hurt them before. When I was growing up and beginning my working career, small businesses thrived with all sorts of regulations and an income tax upper limit of 71% (1970) - and there were scads of small businesses, investment opportunities, and corporate/service operations opening up all over the country - businesses that lasted for years so long as the business owner didn't run it into the ground.

I ran a small side business off the kitchen table for two years before I called it quits in 2000. I filed only personal income taxes, like many small businesses. While I may have made a couple thousand a year, I spent a couple thousand a year on my business, and while I only filed personal income taxes, I didn't make enough after costson my personal business to have shown enough of a return in income/profit to have it affect my normal taxes based off Wages/Reservist Pay income in the slightest.
If I had made more than what it cost me to run my business, I might have seen my taxes go up some; but I would have also had to have had my income go up an equivalent amount.

But for my primary job, I've worked out of a shop when I was running ship electronic installations. I've had to crunch numbers for both the costs of the job, and the cost of shop support and general/administrative costs. Shop Equipment, Inventory, Office Supplies, Rents, Payroll and Consulting costs, Insurance, Regulatory Compliance, State and Local Taxes and Fees, Accounts Receivable and Payable movement, Depreciation costs - all equally tax-deductible for a private businessperson.

If you own a small business, whether or not you pay taxes on it as part of your income tax or under an incorporation, you really need to take some accounting and finance courses so you don't screw up your personal taxes and "blame the government" because you're being taxed out of existence.

Or you can admit that most bad things that happen in small businesses that aren't the government's fault but the market's fault or the businessman's fault. 75% or so of all small businesses will normally fail or be gobbled up by competitors within the first five years.
Small business owners are usually their own worse enemies, especially those who are using their business as a personal ATM and a profit generator instead of coaxing the business along and taking a real financial hit for several years before the business can establish and compete. The focus of the small business owner should not be to make a profit, but to grow the business - and that's a major component of the business strategy that is evident in pretty much every successful small businesses.
Even with a focus on growth, most small businesses still face being doomed by poor location, over-saturation or a lack in their market and market segments, or just starting up at the wrong time or season.

My home business was basically killed over-saturation of like businesses in the local market and by the internet. Graphics Design is a really tough business anyway, and while it was something I loved and was talented enough at that I had a few customers, it would never be able to pay the mortgage, whereas my job as an installation PM could. I saw what was happening, weighed my options, and bailed before my business became a money pit.

As a side, now that I'm getting closer to retirement and the kidlet - who can't hold down a retail job but enjoys doing lots of artsy-craftsy stuff - has expressed an interest, I've been thinking of starting a small store front manufacturing co-op (farmer's market jewelry, ceramics/enameling and other knick-nacks) business.
I'm pretty sure that being in a semi-depressed immigrant neighborhood, I can also rent storage and work space to other home crafters and artists if she flakes out - I've seen a lot of very talented women who are stuck at home who might want to get some extra income.
The space rental, utilities, equipment and equipment maintenance, and cleaning/toxic storage and handling will be the greatest costs; and all of those are tax-deductible, whether you incorporate or run it as a personal business using a 1040 to pay your taxes.
I've got my degree in business and program management, and I know about the EPA, OSHA, and other local business regulations (working shipyards so long has really given me an insight on how they work) so I'm thinking while I'm still gainfully employed and bringing home a livable wage income, I might be able to make a go out of it if the family (husband especially) can also help.

That is, so long as I don't expect we will personally make a lot of money the first five or six years, and hope just to be close to breaking even. However, if it takes off and I make gobs of money - paying taxes is no big deal. Taxes end up paying for the infrastructure that helps me grow my business, and even if I had to pay 50% - 70% to the government because "I got rich", that's the cost of doing business in a fair, level playing field where my customers have a chance to pay for my goods because they're not going to be spending every additional dollar to survive.

Anyway, to get back to the point, a "Maximum Wage" tax policy would not adversely affect a small business owner who has a legitimate business plan and strategy, and a good accountant and has reasonable expectations of profit and costs. Unless, of course, s/he is running a management/life coach firm out of a back "office" of the family Mc-Mansion, earning hundreds of thousands of dollars of income in fees and stock, while trying to deduct the Lamborghini, the 45 ft yacht, gym and spa membership, maid service, shopping trips to Neiman Marcus, and the home mortgage payment as "business deductions". That person would be affected by income tax levels back to the levels of the 1960's.

And yes, I met a couple of those when I did a little small business sales survey work for MCI back in the 90's.
Coastal San Diego is full of little "small business" management and development firms like that; people who make millions of dollars as "go betweens" for rich idiots.

The other thing that most of these "Overtaxed" Free Market advocates overlook is that without government regulation to keep things fair and on the "up and up", the Free Market becomes little more than a Plutocratic dream where the gap between wealth and the average worker keeps growing.
If you want all the money going to those 85 individuals who will own all access to goods and services - and write the rules for their own benefit, you aren't going to have any small businesspeople who can start their businesses without paying a Mafia-like shakedown to whatever Monopoly owns all the rights to starting a business in that region. Talk about centralization of power.
Monopolies control their own pricing, can lie with impunity, stifle innovation and stomp on any competition that may arise. There is no choice in a total free-market system.

And that's why the idea of "Maximum Wages" and allowing for high Maximum Wage Income rates - to allow money to circulate throughout all the markets and population instead of having it collect at the top levels of income and pray they will allow it to trickle down enough to keep the inevitable revolution from starting.

Starving, homeless people have no qualms killing or destroying if there's a chance they might get food and shelter. And it doesn't matter if "it's their own fault" they didn't have bootstraps or it was their choice not to use the ones they might have had. So it behooves those who have much to ensure there aren't a lot of starving or homeless that want. Which means either a government steps in (equitable taxation to provide services), or you just kill the lot of them like feral animals (which is a function of organized crime - turn the desperate poor into drug addicts, prostitutes, soldiers, or mules, then kill them or let them die when they stop providing revenue to the gang).

Haele

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Response to haele (Reply #41)

Thu Jan 30, 2014, 02:27 PM

46. but that is not what is being said

The premise of this thread is "you can only make so much money", period.

Bringing deductions and CPAs into is where we are now, where multi-billion dollar companies pay no taxes, and people who make millions a year pay very little. So, the premise is ... you can only make X times the lowest worker, period. Not before expenses, after deductions, et all.

Which is what I said, that is insane.

If we are talking about changing the tax codes to make people who make insane amounts of money pay insane taxes I am with ya ... when you put a cap on what I can make and tie it to some BS number you lose me.

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Response to Lurker Deluxe (Reply #46)

Thu Jan 30, 2014, 04:26 PM

55. It's not likely I can sell you anything. But I have zero respect for great wealth.

Bill Gates, Steve Jobs, the Koch brothers, Mitt Romney, the Wal-Mart heirs, god knows how many bankers and other financial manipulators... they do not, and they have not, made this world a better place. And even if they had they "deserve" no more than a very comfortable living, and maybe, for the most decent among them (none on the list above!) a lifetime of accolades and celebrity.

Are you wealthy, do you serve the wealthy? Or are you one of Steinbeck's "temporarily embarrassed capitalists?"

See that, I can get the quote right, and it doesn't mean what the right-wingers are always blathering about either. They are as pudding-brained as the "so-called communists" Steinbeck was talking about.

Both capitalism and communism grow deadly when evil men rise to power and ideological purity is enforced. Great disparities of wealth are the fuel of revolutions. It's a rare human who is not corrupted by, or at least disconnected from ordinary society, by great wealth.

As a practical matter these dangerous extremes are avoided with a generous welfare system and a steeply progressive tax system.

I stick with my multiple of 20. The uber-wealthy ought to be taxed out of existence.


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Response to hunter (Reply #55)

Thu Jan 30, 2014, 04:43 PM

56. You can't sell me the multiple of 20

It's just insane when you are talking about wealth that somehow you will limit my wealth to someone who can choose to not save, invest, take care of property .... any list of things.

You say there is a minimum wealth, how do you do that?

You give me a job, I spend all the money.

You give me a house, I let it fall into disrepair.

You give me a car, I wreck it.

How do you keep me in this "minimum wealth"?

And how do you stop the man who works the same job but instead of blowing his money he invests, improves his home, and lives below his means, from accumulating more than 20 times the foolhardy spender??

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Response to Lurker Deluxe (Reply #56)

Thu Jan 30, 2014, 08:16 PM

58. The "minimum wealth" for both the foolhardy and the not foolhardy could be kept in trust.

Maybe every eighteen year old would start out with that. They could be paid the interest on that wealth, or simply leave it to compound.

In effect everyone would be a "trust fund kid" of the USA.

Want to live in an old van in the woods or in mom's basement on that interest income alone? Have at it!

But my utopia offers greater opportunities than that. Get a job, go to school, get a much richer life. Can't get a job because of disability, or simply because the economy sucks, then you'd still get more than you would simply by dropping out of society. During down times it would be worth your while to finding something that makes you happy and contributes to the community, secure in the knowledge you won't hungry or homeless.

Yes, I know it's a thought experiment mostly, but the economy we have now isn't anything close to being fair and truly "equal opportunity." A kid growing up with crappy schools, in a crappy neighborhood, on average isn't going to do as well as the kid living in a good neighborhood, with good schools, with parents who can afford the best colleges, and support them in comfort during their (utterly unethical) unpaid Washington D.C. or Manhattan internships.

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Response to Saviolo (Original post)

Thu Jan 30, 2014, 11:02 AM

15. it's called progressive taxation. think of the tax rate in the 50's.

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Response to Saviolo (Original post)

Thu Jan 30, 2014, 11:06 AM

17. Scuba's Rule -

suggested this morning & I think it's brilliant:

http://www.democraticunderground.com/10024413699

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Response to Saviolo (Original post)

Thu Jan 30, 2014, 11:12 AM

19. Now you're talking!

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Response to Saviolo (Original post)

Thu Jan 30, 2014, 11:58 AM

21. I've been saying we need one for years.

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Response to Saviolo (Original post)

Thu Jan 30, 2014, 12:09 PM

22. The problem isn't wages, it's return on capital.

The capital gains tax and taxes on dividends should be progressive.

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Response to lumberjack_jeff (Reply #22)

Thu Jan 30, 2014, 12:16 PM

24. Exactly.

After a reasonable shelf, capital gains should either be taxed as regular income or have a progressive rate themselves. I would rather see them rolled into regular income and two more brackets added to our progressive tax rates.

Get rid of deductions after a certain income as well.

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Response to Saviolo (Original post)

Thu Jan 30, 2014, 12:32 PM

32. Elimenate the Tax deduction on wages over $1 Million

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Response to FreakinDJ (Reply #32)

Thu Jan 30, 2014, 01:08 PM

39. So, the proper term we should be working with is "income" not "wages". nt

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Response to Saviolo (Original post)

Thu Jan 30, 2014, 12:40 PM

36. Funny. Professional sports leagues like the NFL, NBA, and MLB all have salary caps/luxury taxes

and most sports fans are strongly in favor of these restrictions on pay. They see unfairness of a franchise spending too much on salaries.

Yet, they don't see this same unfairness in every day life.

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Response to Saviolo (Original post)

Thu Jan 30, 2014, 12:57 PM

38. There's always the way we used to do it...

...by progressively taxing high incomes. Even leaving aside the rates as a separate issue, there used to be many more brackets affecting high incomes. Here's a rough chart of the number of brackets historically, also listing the number of brackets that only affected incomes above $250,000 and $500,000 (converted to 2013 dollars):





In terms of how high up the income scale those brackets reached, it's "into the millions". Here's 1941-2013 (in 2013 dollars):


(see that little tan blip on the last one? That's the "socialism" Republicans scream about.)

In case you're wondering why I picked 1942 as a start date, it's purely for readability, thanks to my graphics skills or lack thereof. I need to figure out how to pull off skipping some intervals, because some of those inflation-adjusted brackets reach higher. Much higher:



We need hammer home to people just how radically the structure of taxation has changed since Reagan, and that it's part of the problem. There were certainly problems in the past, but one of the little-sung effects that it did have was it was a market-based incentive against trying to squeeze every last buck. It reinforced diminishing returns on simply extracting wealth, which made reinvestment a better use for that excess. Some would call that properly aligning incentives.

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Response to Saviolo (Original post)

Thu Jan 30, 2014, 01:20 PM

40. A maximum wage is a very different thing to a maximum wage ratio.


The former is self-evidently an absurd idea - it's not about helping the poor, it's about hurting the rich.

The latter, which you're proposing here, is not *completely* absurd, but still wouldn't work in practice.

"we'll see companies starting to make bumper profits when they aren't being dragged down by onerous bonuses and CEO salaries"

What fraction of the wage bill of most companies do you think goes on people making more than, say, 15 or 25 times what the minimum earner makes? I suspect that it's usually really quite small, and wages as a whole are only part of total costs. I wouldn't bet my life on that, though.

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Response to Saviolo (Original post)

Thu Jan 30, 2014, 02:15 PM

42. Maximum wage talk long past due and will never happen

They want to be buried with it. And some don't work for wages, they get their money from stocks (tips supplied by Congress) and inheritances.

Some are gifted and earned by talent in show business, inventions, discoveries, ideas, but this type seems to be more liberal when it comes to sharing and paying people working for them....

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Response to Saviolo (Original post)

Thu Jan 30, 2014, 02:17 PM

44. I heard Lewis Black (iirc) talk about a maximum wage a few years ago.

Never thought about it before that, but now I think it's a good idea. Why should the top boss make any more than 50, 60, or 100 times more than what their average worker makes? The gap between the haves and the have-nots is much too large and society just cannot function (not very well, anyway) with such a large amount of wealth going to such a small amount of people. There is only so much money that can be made in a year. Sure, you can always print more, but eventually that will backfire on you. And really, are there any good reasons for a single person owning a billion dollars? Or even half of that?

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Response to Saviolo (Original post)

Thu Jan 30, 2014, 02:50 PM

49. Federal contractor wages

were capped in the last budget deal.

Varied views on new contractor-pay cap

By Josh Hicks

Federal worker unions have applauded a new limit on pay for government contractors, but one industry group has warned that the “arbitrary” cap will cause problems for those who do business with federal agencies.

The restriction, which came as part of the new budget deal Congress and President Obama approved last month, reduced the highest level of contractor compensation from its previous annual limit of $952,000 per individual to $487,000 per individual, a drop of nearly 49 percent.

- more -

http://www.washingtonpost.com/blogs/federal-eye/wp/2014/01/03/varied-views-on-new-contractor-pay-cap/


Obama pushes to limit federal spending on corporate executive pay
http://www.democraticunderground.com/10022927167

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Response to Saviolo (Original post)

Thu Jan 30, 2014, 03:05 PM

50. The problem of "no more than a multiple of the lowest" is...

...they'll just rearrange the organizational chart so that the units with the lower paid employees are technically in a different company than than the executives. The ratio may apply within the different compartments, but not, legally speaking, across the whole.

I stand by my other post above: restore progressive taxation of high incomes. Stop putting rich CEOs in the same income bracket as orthodontists.

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Response to Saviolo (Original post)

Thu Jan 30, 2014, 03:12 PM

52. What part of our Constitution would that fall under?

I don't think the idea would hold up in court.

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Response to Saviolo (Original post)

Thu Jan 30, 2014, 03:16 PM

53. Rather than a Maximum Wage that attempts to pin some number on an amorphous concept

 

such as wealth or compensation, how about a national minimum standard of living?

When every American is free from unreasonable necessity, who really cares about the mindless pursuit of more?

It is our duty now to begin to lay the plans and determine the strategy for the winning of a lasting peace and the establishment of an American standard of living higher than ever before known. We cannot be content, no matter how high that general standard of living may be, if some fraction of our people—whether it be one-third or one-fifth or one-tenth—is ill-fed, ill-clothed, ill-housed, and insecure.

This Republic had its beginning, and grew to its present strength, under the protection of certain inalienable political rights—among them the right of free speech, free press, free worship, trial by jury, freedom from unreasonable searches and seizures. They were our rights to life and liberty.

As our nation has grown in size and stature, however—as our industrial economy expanded—these political rights proved inadequate to assure us equality in the pursuit of happiness.

We have come to a clear realization of the fact that true individual freedom cannot exist without economic security and independence. “Necessitous men are not free men.” People who are hungry and out of a job are the stuff of which dictatorships are made.

In our day these economic truths have become accepted as self-evident. We have accepted, so to speak, a second Bill of Rights under which a new basis of security and prosperity can be established for all—regardless of station, race, or creed.

Among these are:

The right to a useful and remunerative job in the industries or shops or farms or mines of the nation;

The right to earn enough to provide adequate food and clothing and recreation;

The right of every farmer to raise and sell his products at a return which will give him and his family a decent living;

The right of every businessman, large and small, to trade in an atmosphere of freedom from unfair competition and domination by monopolies at home or abroad;

The right of every family to a decent home;

The right to adequate medical care and the opportunity to achieve and enjoy good health;

The right to adequate protection from the economic fears of old age, sickness, accident, and unemployment;

The right to a good education.

All of these rights spell security. And after this war is won we must be prepared to move forward, in the implementation of these rights, to new goals of human happiness and well-being.

America's own rightful place in the world depends in large part upon how fully these and similar rights have been carried into practice for all our citizens.

For unless there is security here at home there cannot be lasting peace in the world.

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Response to Saviolo (Original post)

Thu Jan 30, 2014, 04:16 PM

54. Switzerland tried to enact the "multiple" thing.

The Swiss "1:12 Initiative" limiting top pay to 12 times bottom pay was a referendum on their election ballot in November. It failed by a 2-to-1 margin. Some CEOs there threatened to move their companies out of the country if it passed.

I agree there needs to be some kind of upper limit on compensation. Without some kind of restraint, many people are prone to becoming Koch-like vampires looking for any way to suck the life out of everything for unlimited personal gain, including buying and subverting democratic governments that allow BIG MONEY to heavily influence elections and policymaking.

As long as BIG MONEY controls much of the electoral process it seems unlikely that anything resembling a maximum compensation law could ever pass at the national level in the U.S. Maybe better odds at the local level similar to locally increasing the minimum wage. ??

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Response to Saviolo (Original post)

Thu Jan 30, 2014, 05:53 PM

57. I think we worry too much about CEO pay

It really doesn't make that big of a difference. I work for a large company (Lowe's)

Last year the CEO, Robert Niblock made 12.1 Million. Pretty good money (but admittly less than a lot of CEO's).

If Robert Niblock were to agree to work for free, and give all the money saved to Lowe's employees, I would get a pay raise of less than 4 cents an hour. I certainly wouldn't turn down a raise of 4 cents an hour, but it won't make a bit of difference in my life.

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Response to Saviolo (Original post)

Fri Jan 31, 2014, 09:42 AM

60. So Peyton Manning could earn up to 10 times what the beer salesman earns?

Brad Pitt could earn up to a certain multiple of what the floor assistant gets paid?

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